Brexit: Heat But No Light For The UK's International Businesses

Author:Mr Sam Eastwood, Jason Hungerford and Paul Whitfield-Jones
Profession:Mayer Brown

Last week's series of Brexit votes in Parliament could mark a profound shift in the trajectory of the UK's exit from the EU. However, businesses still do not know when Brexit will happen (if at all) and what the UK's relationship with the EU and the rest of the world will be.

In the space of three days, the House of Commons voted (i) on Tuesday to reject the UK government's negotiated withdrawal agreement in the second so-called "meaningful vote"; (ii) on Wednesday to reject a no-deal Brexit, with even Cabinet ministers defying the Conservative party whip to vote against it; and (iii) on Thursday to request an extension to Article 50 of the Lisbon Treaty to delay the UK's exit from the EU. And if that was not enough, on Thursday the House also voted marginally against exercising more control over Brexit and overwhelmingly against a measure calling for a second referendum, with even supporters of a second referendum calling on MPs not to back it because it was not the right time.

The government indicated that it intended to put the so-called Withdrawal Agreement before Parliament for a third "meaningful vote," possibly even this week, although ministers said it would not happen unless Prime Minister Theresa May felt she could win it. However, on Monday, March 18, House of Commons Speaker John Bercow shocked most observers when he said the government could not have a third vote without a substantial change to the Brexit deal, citing a 400-year-old precedent to the effect that that the same question may not be put twice to the House in the same session.

Any extension of Article 50, to allow the government more time to seek approval for the Withdrawal Agreement, would require unanimous approval by the European Council, comprising the heads of state of EU member states. It had previously been thought that if Prime Minister May was able to obtain approval for her Withdrawal Agreement before March 29, she could request a "short technical" extension to the Article 50 process. However, the speaker's decision made it very unlikely that another vote would occur in this time frame.

Today, therefore, Prime Minister May has written to Donald Tusk, president of the European Council, to request an extension to June 30, which is still a relatively short period. The letter sets out her intention to bring the Withdrawal Agreement back to the House, with certain changes at both the EU and domestic level, but acknowledges that there will not be sufficient...

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